Russia-India crude trade poses challenges

Western banking sanctions and the crude price cap cause headaches for New Delhi and Moscow

Record inflows of Russian crude into India have created a host of problems for both governments and their respective oil industries. “Russia has accumulated billions of rupees in Indian banks that it cannot use,” Russian foreign minister Sergei Lavrov said in Goa on the sidelines of the Foreign Ministers Council meeting of the Shanghai Cooperation Organisation in early May. “This is a problem. We need to use this money. But for this, these rupees must be transferred in another currency, and this is being discussed now.” For seven months from October 2022 to April 2023, Russia was the largest source of India’s crude imports. However, payment issues, the price cap and viability of Russia as a